I easily saved hundreds of dollars last year using this super simple app – here's how

The Insider Picks team writes about stuff we think you'll like. Business Insider has affiliate partnerships, so we get a share of the revenue from your purchase.

Digit

I'll be the first one to admit saving money isn't easy. Though I try to be mindful of my money, it's hard to consider my future finances when I hail a cab late one night or spot a "once in a lifetime" travel deal. And if I'm being honest, creating a formal budget sounds like a headache. Along with doing your laundry and cooking dinner, saving money is something every adult should do. But just because we should save money doesn't mean we actually do it.

I was initially skeptical when my friend recommended a saving app called Digit last summer. I didn't think that by downloading an app I'd probably never use would end up saving me all that much. However, after using Digit for a year, I found saving money can be as much of my routine as doing laundry.

From there, the app analyzes your spending patterns, like your morning cup of coffee, rent and utilities, and when you receive your paycheck. Each day, Digit compares your current balance to previous days and predicts your future cash flow. If you have some extra cash on hand, Digit can automatically transfer a small dollar amounts into a separate savings account. Setting aside a little bit every few days doesn’t seem like it’ll make a big difference, but you can end up saving a lot over time. All Digit savings accounts are FDIC-insured, so they’ll cover up to $250,000.

Digit also makes keeping tabs on your savings incredibly easy. The app sends daily texts about your current balance, recent transactions, and how much you're saving. If you want to receive more information, modify your account, or withdraw money, you can do it by texting back. I love how easy this feature makes banking.

I've already saved a couple hundred dollars through Digit. Not only did I avoid drafting up some unrealistic budget, but since Digit analyzes my spending habits, I was able to save without altering my lifestyle. I was able to go on three vacations this year, regularly go out to dinner, buy a large iced tea each morning, and still save some money. I managed to do it without feeling like I was restricting myself too much, and I think this method will be helpful for a lot of people who might want to save more but don't know where to start.

Create an account

Digit

Once you enter your name, e-mail, and phone number, you'll be required to connect Digit to your checking account. I'll admit I was wary about sharing my account's routing number with an app, but Digit uses bank-level security and doesn't store your information, so your account will be safe.

The app is compatible with over 5,000 US banks and credit unions, so it's bound to work with your account.

If you don't know where to find your checking account information, try looking at your W-2 or 1090.

Get text updates

Digit

This is hands-down my favorite feature. Checking your balance each morning is a great way to avoid overdraft fees and catch fraudulent charges, but I always forget to do it. Digit's text notifications makes it a lot easier to keep tabs of my finances. Each morning, I receive a text outlining my balance, recent transactions, and how much I've saved.

Digit also uses GIFs and cheeky salutations like "Yo," "Ciao," and "G'day," which makes your finances feel a little more fun.

Decide how much you want to save

Digit

Digit uses a special algorithm to determine how much money to save, but can also customize your saving habits:

Turn "Automatic Saving"on or off: Through the "Automatic Saving" feature, the app will do the legwork for you automatically save money whenever it sees fit. Digit will start saving within two to three days after you set up an account. If you want to be more hands-on with your savings, turn "Automatic Savings" off.

Save a specific amount of money: Want to take matters into your own hands? You can transfer certain amounts of money into your Digit saving account. To do so, text "Save" and the amount you'd like to transfer.

Set a checking account minimum: The checking account minimum is a great option for anyone who wants to have a certain amount of money in their account at all times. Once you set your minimum (it doesn't matter if it's $25 or $500), Digit won't save if your checking account dips below that number. To activate this feature, simply text "Minimum" and your desired amount.

Categorize your saving into "goalmojis"

Kelsey Mulvey/Business Insider

Everyone uses their savings differently. Some people save for good measure while others save up to buy a house or book a vacation. Anyone of the latter mindset will love Digit's "Goalmojis" function, which lets you to create sub-accounts for specific goals.

Simply text "New Goalmoji" to Digit and you'll be able to set how much you want to save and your saving deadline. For quick access to your sub-account, Digit will ask you to select a corresponding emoji (think a ring emoji for engagement ring shopping or a palm tree for your upcoming vacation). The app will notify you once you reached your goal so you can withdrawal your savings.

Earn a saving bonus

Kelsey Mulvey/Business Insider

Only banks can pay interest, but Digit still wants to using the app worth your time and money. The app will give you an annual saving bonus, which is distributed every three months. Each quarter, it will determine your saving bonus by the average daily balance in your Digit account. You'll receive a 1% bonus each year, or 0.25% every three months.

No overdraft fees

Digit

Digit wants to save you money, but not at the risk of receiving an overdraft fee. Thanks to its "Overdraft Guarantee," Digit promises it'll only save what you can afford. And on the off chance your account is overdrawn by Digit's auto-saving feature, the app will refund up to two overdraft fees.

Withdrawal whenever you want

Digit

Ready to cash in on your savings? Text "Withdraw" and the desired amount will be in your checking account one business day later. Your Digit account doesn't require a minimum balance, so you're free to withdraw as much as you'd like.

All told, if you're looking for an easy way to save, I couldn't recommend Digit more.

If you want to see more from Insider Picks, we're collecting emails for an upcoming newsletter. You'll be the first to hear about the stuff we cover. Click here to sign up .

Disclosure: This post is brought to you by Business Insider's Insider Picks team. We aim to highlight products and services you might find interesting, and if you buy them, we get a small share of the revenue from the sale from our commerce partners. We frequently receive products free of charge from manufacturers to test. This does not drive our decision as to whether or not a product is featured or recommended. We operate independently from our advertising sales team. We welcome your feedback.
Have something you think we should know about? Email us at insiderpicks@businessinsider.com.